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National report on the promotion of the use of biofuels or other renewable fuels for transport in Romania 2009 1. Introduction In accordance with Article 4 of Directive 2003/30/EC on the promotion of the use of biofuels or other renewable fuels for transp ort, Member States report to the Commission every year prior to 1 July: a. the measures taken to promote the use of biofuels or other renewable fuels to replace diesel or petrol for transport purposes, b. the national resources allocated to the production of bio mass for energy uses other than transport, and c. the total sales of transport fuel and the market share of biofuels, pure or blended, and of other renewable fuels placed on the market for the preceding year. Where appropriate, Member States must report on an y exceptional conditions in the supply of crude oil or oil products that have affected the marketing of biofuels. 2. Measures to promote the use of biofuels in transport 2.1. Regulatory environment The use of biofuels and other renewable fuels for transpo rt is being promoted with the aim of partially replacing petrol and diesel, contributing to achieving certain objectives such as: meeting commitments for the reduction of greenhouse gases, ensuring fuel security in a manner compatible with the environment and increasing the level of energy independence, promoting the use of renewable energy sources. In addition, promoting the use of biofuels could create new opportunities for sustainable rural development, with the potential to open up new markets for agricultural products. Directive 2003/30/EC was transposed in full by Government Decision No 1844/2005 on the promotion of the use of biofuels and other renewable fuels for transport, published in Official Gazette No 44 of 18 January 2006. Romania must ensure that a minimum percentage of biofuels or other renewable fuels for transport are introduced onto the market by 2010. The minimum percentage set is 5.75%, calculated on the basis of the energy content of all types of petrol and diesel used in transport. In order to meet the target, Government Decision No 1844/2005 was amended by Government Decision No 456/2007, published in Official Gazette No

345 of 22 May 2007, making provision for the staggered introduction of a minimum percentage of biofuels in conventio nal fuels, as follows: a) from 1 July 2007, diesel with a minimum 2% biofuel content by volume; b) from 1 January 2008, diesel with a minimum 3% biofuel content by volume; c) from 1 July 2008, diesel with a minimum 4% biofuel content by volume; d) from 1 July 2009, petrol with a minimum 4% biofuel content by volume. The European Council of March 2007 reaffirmed the Community's commitment to the Community-wide development of energy from renewable sources beyond 2010. Thus, with the aim of achieving the tar get of 10% of biofuels by 2020, calculated on the basis of the energy content of all types of petrol and diesel used in transport (Article 3(4) of Directive 2009/28/EC on the promotion of the use of energy from renewable sources and amending and subsequently repealing Directives 2001/77/EC and 2003/30/EC), it was considered appropriate to increase the content of biofuels in conventional fuels by amending Government Decision No 1844/2005 on the promotion of the use of biofuels and other renewable fuels for transport. In this context, fuel suppliers are introducing on the market only a blend of biofuels and conventional fuels - derived from mineral oils as follows: a) from 1 January 2011, diesel with a minimum 5% biofuel content by volume; b) from 1 January 2013, diesel with a minimum 7% biofuel content by volume; c) from 1 January 2011, petrol with a minimum 5% biofuel content by volume; d) from 1 January 2013, petrol with a minimum 7% biofuel content by volume; e) from 1 January 2017, petrol with a min imum 9% biofuel content by volume; f) from 1 January 2018, petrol with a minimum 10% biofuel content by volume. 2.2 Promotion using economic instruments The inclusion in the Fiscal Code of an exemption from the payment of excise duty for energy products that fall under the category of biofuels and other renewable fuels. This provision forms the subject of Article 201(l) of Law No 571/2003 on the Fiscal Code, as amended by Law No 343/2006. The implementing rules for the Fiscal Code are approved by Governme nt Decision No 1618/2008. Emergency Government Ordinance No 125/2006 approving the direct payment and complementary national direct payment schemes granted for agriculture starting from 2007, and amending Article 2 of Law No 36/1991 on agricultural companies and other forms of agricultural associations, approved with amendments by Law No 139/2007; Financial assistance is granted to agricultural producers for the cultivation of sunflower, oilseed rape, soya and corn under the single area payments scheme (SAPS) and the payment scheme for energy crops;

 Order No 549/2007 establishing the method of implementation, the specific conditions and eligibility criteria for application of the direct area payments scheme for energy crops. 3. Biomass potential in Romania Romania has a total surface area of 91 843 square miles; 62% of this is occupied by agricultural land, 28% is forest or other land with forest vegetation, and 10% other types of land (waters, marshes, unproductive land, etc). Romania's agricultural lands break down into the following classes of suitability: Class I (very high suitability): 2.8% of agricultural land, of which approximately 3.8% is arable land; Class II (good suitability): 24.7% of agricultural land, of which approximately 35.9 % is arable land; Class III (average suitability): 20.8% of agricultural land, of which approximately 25.3% is arable land; Classes IV and V (poor and very poor suitability): 51.7% of agricultural land, of which approximately 35% is arable land. Romania has a total arable area of 9 379 331 hectares. Given the soil and climate conditions in Romania, the most viable crops for the production of first generation biofuels are: for the production of biodiesel: oilseed rape, sunflower and soya; for the production of bioethanol: sugar beet, cereals (grain, corn, etc). In the existing topogeographical environment, Romania is considered to have a high biomass energy potential, estimated at approximately 7 594 thousand TOE*/year (318x10^9 MJ/year), which represents around 19% o f the total consumption of primary resources in 2000, broken down into the following categories of fuels: residues from forestry activities and firewood 1 175 thousand TOE (49.8x10^9MJ/year); wood waste sawdust and other wood scrap 487 thousand TOE (20.4x10^9 MJ/year); agricultural waste resulting from cereals, corn stalks, plant debris from vines, etc. 4 799 thousand TOE (200.9x10^9 MJ/year); biogas 588 thousand TOE (24.6x10^9MJ/year); urban household waste and residues 545 thousand TOE (22.8x10^9 MJ/year). * Romania's strategy for the exploitation of renewable energy sources, as approved by Government Decision No 1535/2003.

4. Romania's potential as regards the production of biofuels Romania's potential to supply the raw material necessary fo r biodiesel, namely vegetable oil (sunflower, soya, oilseed rape) is approximately 500 -550 thousand tonnes/year. Its potential to supply the raw material necessary for bioethanol, namely for corn seed is approximately 390 thousand tonnes/year and for wheat germ approximately 130 thousand tonnes/year. At present Romania has a production capacity of approx. 400 thousand tonnes/year for biodiesel and approx. 120 thousand tonnes/year for bioethanol. 5. National resources allocated to the production of biomass Biomass is the main rural fuel, being used especially to heat dwellings and water and in cooking. Biomass accounts for 7% of primary energy demand and 50% of Romania's potential renewable resources. The National Wood Institute estimates the annual produ ction of fire wood from forests to be 1 677 thousand m 3, and the volume of bark to be 0.860 thousand m 3 with an annual availability of residues resulting from the primary processing of wood (sawdust, ends etc) of 2 095 thousand m 3. The estimated quantity of national forest biomass resources for 2015 and 2020 (thousand m3) Sector/origin 2015 2020 Primary resource 3.0 3.5 Secondary resource 3.5 4.0

6. Total sales of transport fuels - 2009 Type of fuel Total sales (tonnes) 987 563 Unleaded petrol (minimum 95 =< RON < 98 & < 10 ppm sulphur) 645 253 Unleaded petrol (minimum RON >= 98 & < 10 ppm sulphur) Total petrol Diesel < 10 ppm sulphur Total diesel 1 632 816 4 060 697 4 060 697

Total petrol and diesel

5 693 513

7. Total sales of transport fuels In 2009 approximately 231 216 tonnes of biodiesel and bioethanol were used in Romania (14 8606 tonnes of biodiesel and 82 610 tonnes of bioethanol), which gives a percentage of 4.1% calculated on the basis of the energy conten t of all types of petrol and diesel used in transport. 8. Quality of biofuels The Ministry of Economy, Trade and the Business Environment is responsible for implementing the 'Qualitative and quantitative monitoring system for petrol and diesel' marketed i n filling stations, as approved by Order No 742/2004 of the Minister for Economy and Trade, the annex to which was replaced by Order of No 58/2006 of the Minster for Economy and Trade. In 2009, under the 'Qualitative and quantitative monitoring system for petrol and diesel', checks were carried out to determine the fatty acid methyl ester (FAME) content of approximately 200 diesel samples and to determine the content of biofuels in petrol in approximately 100 petrol samples. The checks were performed by bodies recognised by the Ministry of Economy, Trade and the Business Environment to carry out sampling of petrol and diesel, in accordance with Order No 907/2004 of the Minister for Economy and Trade approving the list of recognised bodies carrying out sampli ng activities, as amended. Standard SR EN 14078:2004 is used to determine the fatty acid methyl ester (FAME) content in diesel and standard SR EN 1601:2000 is used to determine the content of biofuels in petrol. In accordance with Government Decision No 4 56/2007, failure to place the mix of biofuels and conventional fuels on the market is punishable by a fine of RON 7 500 to RON 15 000.